California’s New COMPETE Act: What Small Businesses Need to Know

Amy Sulahian • September 30, 2026

Share this article

Authored by Samantha Liu

The new law expands the state’s antitrust framework.

On September 30th, Governor Newsom signed a bill that will provide greater protection for competition and small businesses. The COMPETE Act, which is considered an update to the pre-existing Cartwright Act, aims to extend the state's antitrust regulations to include anticompetitive behavior resulting from single-firm conduct.


The Bill's Origins:

To fully understand the COMPETE Act, it is important to understand the bill's origins and how the legislative update broadens California's antitrust protections.


Originally passed in 1907, the Cartwright Act was California’s main antitrust law that forbade arrangements or agreements that impede commerce or undermine market competition. Examples include economic collusion such as price-fixing and agreements that unfairly restrict trade, along with other behaviors that encourage the formation of a trust.


While the bill provided legislators with strong tools to fight unfair business practices, California's antitrust laws historically lacked a specific state-law framework for addressing independent, single-firm monopolization in the same way that federal antitrust law does.


Filling in the gaps:

Because a true monopoly typically features a single dominant company operating independently, state enforcers can now use the COMPETE Act to address certain unilateral monopolization and monopolization conduct.


Additionally, the COMPETE Act now:


  • Extends California's antitrust laws to certain single-firm monopolization, monopolization, and attempted monopolization or monopolization.
  • Requires plaintiffs to establish substantial market power, which can be shown through either direct or indirect evidence.
  • Provides California courts with a state-law framework for analyzing single-firm conduct, using guidance from the California Supreme Court.
  • Exempts qualifying small businesses from the new single-firm monopolization provisions, including businesses with 100 or fewer employees and average annual gross receipts of $10 million or less, subject to the law's other requirements.
  • Limits enforcement of the new single-firm provision to the California Attorney General and district attorneys, rather than creating a new private right of action. 


These changes could significantly change the litigation and enforcement landscape as California begins applying its updated antitrust laws as they stand a greater chance of surviving trial. The last known criminal prosecution under the Cartwright Act was in 1995, which marked the beginning where prosecutors halted pursuing antitrust behavior, though private civil litigation under the Cartwright Act has continued since then.


The COMPETE Act therefore gives California state enforcers another tool to address certain anticompetitive conduct by large or dominant businesses. However, the law's practical impact will become clearer as courts and enforcement agencies begin interpreting and applying the new provisions.


Get Advice For Your Business

California's antitrust laws are changing, and businesses should understand how the COMPETE Act may affect their operations, competition, and potential legal exposure.


Sulahian Law can help you understand your rights and obligations under California's evolving antitrust laws. Contact us today to discuss your business and learn more about how these changes may affect you.


Legal Disclaimer

The information provided is for general informational purposes only and does not constitute legal advice. The content is not intended to be a substitute for professional legal counsel and should not be relied upon as such. No attorney-client relationship is created or implied by your use of this site, by submitting your information through the contact us page, or by receiving a response from that contact. Communications made through this platform are not protected by attorney-client privilege and should not be treated as confidential. Laws vary by jurisdiction and change over time, and the information presented here may not reflect the most current legal developments or apply to your specific circumstances. Before taking any action based on information found on this site, you should consult with a licensed attorney in your jurisdiction who can evaluate the particular facts and circumstances of your situation. Sulahian Law makes no representations or warranties, express or implied, regarding the accuracy, completeness, or timeliness of the information provided, and disclaims any liability for actions taken or not taken based on its content. Prior results described or referenced, if any, do not guarantee or predict a similar outcome in any future matter. This blog is not intended as, and should not be construed as, advertising or solicitation for legal services in any jurisdiction where such communications are subject to specific regulatory requirements or restrictions.


Sources Cited

• California Expands Antitrust Law With New Powers to Target Monopolies

• Legiscan California Assembly Bill 1776

• Governor Newsom signs historic law to stop big business from shutting out competition, cuts red tape to speed up business permitting

• Proposed Broad California Antitrust Legislation Passes Senate Judiciary Committee

• California Legislative Information Business and Professions Code - BPC DIVISION 7. GENERAL BUSINESS REGULATIONS [16000 - 18107]  



Recent Posts